February 1, 2013 / 8:21 AM / in 4 years

UPDATE 1-Tate & Lyle sees sucralose volumes dip, high corn price

2 Min Read

* Q3 adjusted pretax profit lower than a year ago, in line with expectations

* Expects small increase in net corn costs in the final quarter

* Impact of aflatoxin on operating profit estimated at 7 mln stg

* Expects to make modest FY progress

* Shares fall 3.7 pct to 782.5 pence

LONDON, Feb 1 (Reuters) - British sweeteners and starches maker Tate & Lyle Plc said full-year sucralose volumes would be slightly lower than in 2012, and that it expected corn prices to remain high.

Tate & Lyle, whose brands include zero calorie sweetener Splenda, guided on Friday that it would make "modest progress" for the full-year and that while sucralose volume growth had now returned to normal, poor growth in November meant it expected full-year volumes to be lower than a year ago.

The firm also said that it expected a small increase in net corn costs in its final quarter, with supplies in the United States and Europe remaining tight and prices set to stay high until the new harvest.

Shares in the FTSE 100-listed group, which have risen 23 percent on six months ago, were down 3.7 percent to 782.5 pence at 0805 GMT.

It added that the estimated impact of aflatoxin - a fungus caused by the unusually hot and dry conditions last summer, which particularly affected corn in its third quarter - would reduce full-year operating profit by around 7 million pounds.

The group said adjusted pretax profit for the three months to Dec. 31 had been broadly in line with its expectations, falling lower than a year ago due to investments in its IT systems and reopening a sucralose plant in Alabama this year.

Within its speciality food ingredients division overall volume growth had been ahead of the wider market, it said, while its bulk ingredients division saw "solid" demand for liquid sweeteners in North America in the period.

For the full-year the firm is expected on average to report an adjusted pretax profit of 329.56 million pounds ($522.5 million), according to a Reuters poll of 16 analysts.

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